Ford Motor Co. (NYSE:F) and General Motors Co. (NYSE:GM) are reportedly in discussions to provide a financial lifeline to save the bankrupt auto parts supplier First Brands Group.
The potential deal involves the automakers making advance payments for the products they are set to receive. This would provide First Brands with much-needed cash to continue its operations.
The talks are reportedly in the final stages, with the deal’s success still uncertain, reported the Financial Times on Tuesday.
The Ohio-based supplier produces critical components for Ford and GM, including windshield wiper parts used in Ford’s F-150 pickup truck.
Several automakers are in advanced talks over a deal that would require upfront payments for expected parts deliveries, the publication reported. While discussions are close to the “finish line,” the agreement could still collapse, with Ford seen as the most exposed and facing the highest risk among participants.
Ford, GM, and First Brands did not immediately respond to Benzinga‘s requests for comment.
First Brands Collapse: A Timeline
The potential rescue of First Brands by Ford and GM comes after a series of events that have rocked the auto industry.
- September 2025: First Brands filed for bankruptcy, disclosing almost $12 billion in debt and off-balance sheet financing.
- November 2025: The company has sued its founder, Patrick James, and several others, accusing them of fraud that allegedly left the firm burdened with at least $2.3 billion in liabilities. At the same time, the U.S. Securities and Exchange Commission opened an investigation into Jefferies Financial Group Inc. (NYSE:JEF), examining whether the investment bank properly disclosed its exposure to First Brands during the collapse.
- Jan. 26, 2026: First Brands announced plans to scale back certain U.S. operations, including its Brake Parts and Autolite brands.
- Recent bankruptcy hearing: A company lawyer said First Brands has been in discussions with lenders to obtain new financing through a loan to support ongoing operations, reported FT.
The potential rescue of First Brands by Ford and GM highlights the ripple effects of the auto industry’s challenges, including the shift to electric vehicles, changes in policy, tariffs, and supply chain disruptions.
Jim Chanos, a well-known Wall Street short seller famed for exposing Enron’s fraud, had warned that the bankruptcy of U.S.-based First Brands Group could spark a broader wave of corporate failures.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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